Unliquidated damages

A legal remedy of monetary compensation which takes into account the measure of loss, the amount of which is yet to be determined, i.e. damages which arise that are not subject to any contractual liquidated damages clause.

In cases requiring an assessment of unliquidated damages, the court will adopt a compensatory approach, looking to restore the innocent party to the position it would have been in but for the breach. This is done by considering:

  • Expectation damages – compensation equal to the benefit the aggrieved was supposed to receive; or
  • Reliance damages – compensation according to the costs suffered; or
  • Loss of chance damages – compensation for the value of the ‘chance’.

The court will assess the actual losses, including any forfeited gains, where they have arisen as a natural consequence of breach. The nature and extent of the lost must have been foreseeable (although not necessarily foreseen) at the time the parties contracted.